- During the trading session on Friday, we have seen the Ethereum market fall rather drastically.
- In fact, at one point it looks like we were going to test the crucial $2000 level.
- The $2000 level of course is an area that has a lot of psychology attached to it, and I think this is a situation where we have a lot of value hunters trying to get involved in this market. By the end of the day, it looks like we are trying to do everything we can to turn around and form a bit of a hammer.
The hammer is a candlestick that a lot of people will be paying attention to as it causes a lot of people to start buying, and if we can break above the top of the hammer, then it’s possible that we could open up the possibility of a move to the $2400 level, and a move above there opens up the possibility of a move to the $2800 level. The $2800 level has been important more than once, so I think that attracts a lot of attention, especially as the 50 Day EMA is right there as well, that could come into the picture as a bit of a barrier also.
Ethereum Follows Bitcoin
Keep in mind that Ethereum will almost always follow Bitcoin, and therefore we need to watch the Bitcoin market as well. All things being equal, this is a market that should be getting close to finding a bottom, but it will be very noisy on the way back out. If you were going to be bullish on Ethereum, we are probably in an area that it makes sense to be. Whether or not it actually takes off for a longer-term move remains to be seen, but if you can keep your position size reasonable, the risk to reward here is fairly strong.
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